The world's best spies go unnoticed. They flit through enemy territory, hidden behind disguises or under the cover of darkness while using pocket-size gadgets to gather intelligence. They never announce themselves.

Chris Cameron is not the world's best spy. One bright morning this spring, he zipped up a black jacket emblazoned with the logo of his sailing team, Emirates Team New Zealand. He then grabbed an 18-inch-long camera lens, hopped onto a powerboat and announced his plan. "We're going down to Oracle," he said, referring to rival Oracle Team USA.

The America's Cup, which begins in San Francisco July 4, isn't just sailing's most prestigious competition. It is also a showcase for the most shamelessly conspicuous spy operation in professional sports.

From San Francisco's waterfront, it's impossible to miss the teams practicing on their 13-story-tall yachts—and the fleet of enemy spy vessels trailing them. Onboard the powerboats, which sport their teams' logos, are photographers with $10,000 Nikon lenses trying to shoot pictures of something the other guys don't want them to see: a shorter sail, a lighter foil, a modified rudder.

Reconnaissance in the Cup is about as old as the 162-year-old competition itself, and it's especially crucial this year because the four teams are racing largely untested, state-of-the-art yachts. The squads spy on each other to avoid missing technological breakthroughs and to learn their opponents' racing strategy.

"Sometimes you get caught up in your own processes and you want to think outside the box," said Cameron, the New Zealand team photographer. "Those guys"—the competition—"are thinking completely outside the box."

Espionage has already permeated this Cup. New Zealand coach Rod Davis said that in November, his team needed to test a new foil, which elevates a boat's hull above water so the boat goes faster. The problem: An Oracle spy boat was lurking outside their Auckland dock.

The solution was to prepare two yachts. One had the new foil. The other didn't. Both left dock, but the sailors on the new-foil boat pretended to suffer a breakdown. The decoy sailed off and Oracle took the bait, Davis said, leaving the first yacht to test the foil.

Oracle's mistake, Davis said, was not noticing that his team's best sailors were aboard the supposedly broken-down boat. "The other guys were actors," said Davis, who was on the decoy himself, "and they sold it."

Davis said the ruse helped hide the new foil from Oracle for weeks. Oracle said that wasn't the case. "We actually saw what happened that day," said Jimmy Spithill, Oracle's skipper. "We have boats all over."

It's easy to see why teams spy on one another. Cup organizers set guidelines on boat design, but there's enough leeway for teams to modify boat parts, even during the middle of the weeks-long competition. Weight and aerodynamics are crucial in sailing; in a 20-minute race, slight tweaks can mean the difference between winning and losing.

"It's not the sailing" that wins the Cup, said Dennis Conner, the legendary American sailor who won four Cups in the 1970s and 1980s. "It's the equipment."

Espionage has long been part of the Cup, but spying ratcheted up after the 1983 competition. The Australian team arrived in Newport, R.I., with a revolutionary design for a keel, the underwater fin that stabilizes a boat, and shrouded it with a skirt while the boat was docked so other teams couldn't see it.

In 1985, British police arrested a man trying to sell the U.K. team's keel design for $25,000, said Tom Ehman, then the director of a U.S. team that received the sales pitch.

Cup officials banned aerial and underwater surveillance after the 1992 Cup, which featured helicopter and scuba-diver reconnaissance.

While sailing teams can be friendly to the spy boats—Cameron said the Italian team once tossed him ice-cream bars—others pull pranks. In 1995, Matt Mason and five fellow grinders, the burly guys who crank the winches aboard a ship, on Team New Zealand once boarded an Australian spy boat, pinned down the lone crewman and stripped him of his gear and clothing. They returned to their own boat with booty.

"We hoisted his jeans up on a halyard," said Mason, now with Oracle, proudly.

In recent years, the Americans have been accused of playing dirty. In 2009, a Swiss team alleged an Oracle team member named Jean Antoine Bonnaveau illegally took photos at its base. Oracle called it "legal observation" and no charges were filed after a local-police investigation.

Last November, the Italian team Luna Rossa accused Oracle of violating a rule that prohibits boats from "navigating" within 200 meters of a competing yacht for surveillance. Oracle denied wrongdoing, citing the Oxford English Dictionary's definition of "navigate," which equates navigating with moving. Oracle said its spy boats were simply parked while the Luna Rossa yacht sailed by.

A Cup panel found Oracle's argument "flawed and unreasonable." It punished the team, forbidding it to practice five days this spring, a minor penalty.

As for the intelligence gathered, Oracle team chief Russell Coutts isn't sure whether it actually helped. "At the end of the day, it's the team with the fastest boats and best sailors that wins," he said.

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